8 Stocks Ripping Higher on Big Volume - views

WINDERMERE, Fla. (Stockpickr) -- Professional traders running mutual funds and hedge funds don’t just look at a stock’s price moves; they also track big changes in volume activity. Many times when above average volume moves into equity it precedes a large spike in volatility.

Major moves in volume can signal unusual activity, such as insider buying or selling -- or buying or selling by “superinvestors.”

Unusual volume can also be a major signal that hedge funds and momentum traders are piling into a stock ahead of a catalyst. These types of traders like to get in well before a large spike, so it’s always a smart move to monitor unusual volume. That said, remember to combine trend and price action with unusual volume. Put them all together to help you decipher the next big trend for any stock.

SXC Health Solutions (SXCI) is a provider of pharmacy benefit management services and healthcare information technology solutions to the healthcare benefit management industry. This stock is trading up 1.6% at $92.23 in recent trading.

Today’s Volume: 1.9 million

Average Volume: 884,229

Volume % Change: 348%

Shares of SXCI are moving modestly higher the company said late Thursday that it anticipates realizing net proceeds of as much as $518.6 million from a secondary equity offering.

From a technical perspective, SXCI is gapping up a bit here on monster volume. This stock has been range bound for the last few weeks between $90 and $96.50 a share.

Traders should look to play the move outside of that range either way. Look for long-biased trades if it takes out $96.50 with strong volume, or look for short-biased trades if it loses $90 with volume. I would consider any volume day that’s near or above 884,229 shares as strong. If $96.50 is taken out with volume, then look for $100 to get hit, and if $90 is taken out with volume, then $80 is a reasonable target on the downside.

Netflix

Netflix (NFLX) is an Internet subscription service streaming television shows and movies. This stock is trading up 6.6% at $77.27 in recent trading.

From a technical perspective, NFLX is bouncing right near some previous support at $70.58 on decent volume. This move is coming off of oversold territory for NFLX since its current RSI index reading is 33.20.

Traders should continue to look for long-biased trades if NFLX can manage to clear near its daily highs with high-volume. At last check, NFLX has hit a daily high of $78.30 and volume is still below its three-month average action of 5,798,520 shares. If we get that strong close with bullish volume, then look for continued upside momentum that takes NFLX towards its next significant overhead resistance levels at $83 to $88.

Nvidia

Nvidia (NVDA) is engaged in creating the graphics chips used in personal computers. This stock is trading up 8.6% at $13.50 in recent trading.

Today’s Volume: 21.8 million

Average Volume: 13.3 million

Volume % Change: 321%

Shares of NVDA are soaring today after the company said it expects second quarter revenue of $990 million to $1.05 billion, ahead of Wall Street estimates of $976 million.

From a technical perspective, NVDA is gapping up huge here on above average volume.

Traders should now look for long-biased trades if NVDA can close back above both its 50-day moving average at $14.06 and its 200-day moving average of $14.30 with strong volume. I would consider volume that’s near or above 13.3 million shares as strong.

I would look for short-biased trades only if NVDA closes below today’s low of $13.23 with volume since it could see the gap get filled to the downside.

MYR Group

MYR Group (MYRG) is a specialty contractor serving the electrical infrastructure market in the U.S. This stock is trading up 9.2% at $15.83 in recent trading.

Today’s Volume: 386,000

Average Volume: 182,261

Volume % Change: 316%
GShares of MYRG are ripping higher today after Bank of America-Merrill Lynch started the stock with a neutral rating.

From a technical perspective, MYRG is bouncing off its recent low near $14.18 here with heavy volume. Coming into this bounce today, MYRG was downtrending badly from its February high of $23.50 to that low of $14.18.

Traders should only consider long-biased trades in MYRG if it can manage to sustain a high-volume move or close back above both its 50-day moving average at $17.39 and its 200-day moving average of $18.95. Look for volume on that move that’s near or above 182,261 shares.

I would avoid any long trades in MYRG if this stock fails to maintain a trend above both of those key moving averages with strong upside volume flows.

Express Scripts Holding

Express Scripts Holding (ESRX) provides a range of pharmacy benefit management services in North America. This stock is trading up 3.4% at $56.20 in recent trading.

Today’s Volume: 9.04 million

Average Volume: 9.1 million

Volume % Change: 103%

Shares of ESRX are moving notably higher today after the company said first quarter earnings fell 18% as acquisition-related expenses weighed on its bottom-line, though revenue increased more than expected.

From a technical perspective, ESRX is gapping back above its 50-day moving average of $52.23 here with decent volume. This move is quickly pushing ESRX within range of a near-term breakout trade. That trade will hit once $57 is taken out with strong volume.

Traders should now look for long-biased trades if ESRX can sustain a move or close above $57 with volume that’s near or above 9.1 million shares. If we get that action soon, ESRX could make a run at its April high of $59.

HeartWare International

HeartWare International (HTWR) develops and manufactures small implantable heart pumps, or ventricular assist devices, for the treatment of advanced heart failure. This stock is trading up 7% at $82.55 in recent trading.

Today’s Volume: 211,000

Average Volume: 170,494

Volume % Change: 139%

Shares of HTWR are surging higher today after analysts at Canaccord Genuity increased their price target on the stock from $95 to $101. The analysts wrote in a note to investors: “With HTWR crushing Q1 results, taking over the #1 LVAD share position OUS for the first time, and offering a plethora of potentially favorable upcoming catalysts (FDA approval and launch, first in man for MVAD, GLP studies for fully-implantable device), we reiterate HTWR as one of our best ideas for 2012.”

From a technical perspective, HTWR is gapping up strong here on above average volume. This move has pushed the stock into breakout territory since its now trading above some near-term overhead resistance at $81.06.

Traders should continue to look for long-biased trades as long as HTWR is trending above $81.06, and if it can manage to close near its daily high of $84.25. If we continue to see that action, then HTWR has a great chance to re-test its next significant overhead resistance levels at $92.73 to $99.10 in the near future.

HiSoft Technology

HiSoft Technology (HSFT) is a China-based provider of outsourced information technology and research and development services, primarily for companies in the U.S. and Japan. This stock is trading up 4.5% at $16.00 in recent trading.

Today’s Volume: 398,000

Average Volume: 156,397

Volume % Change: 383%

Shares of HSFT are moving notably higher today after the company beat Wall Street earnings estimates by 2 cents per share, beat on revenues and guided second-quarter EPS in line. The company also guided 2012 EPS above consensus and revenues above consensus.

From a technical perspective, HSFT is ripping higher here right off its 50-day moving average of $14.97 on above average volume. This move is quickly pushing HSFT within range of a major breakout trade. That trade will hit once HSFT takes out some near-term overhead resistance at $16.43 with high-volume. Traders should now look for long-biased trades if HSFT can sustain a move or close above $16.43 with volume that’s near or above 156,397 shares. If we get that action soon, then HSFT can continue its trend higher towards its next significant overhead resistance level at $21.03.

Auxilium Pharmaceuticals

Auxilium Pharmaceuticals (AUXL) is a specialty biopharmaceutical company with a focus on developing and marketing products to predominantly specialist audiences. This stock is trading up 2.5% at $18.65 in recent trading.

Today’s Volume: 566,000

Average Volume: 393,527

Volume % Change: 197%

Shares of AUXL are moving higher today after RBC Capital said there is a 60%-65% chance that the Phase III study of Auxilium’s Peyronie will yield positive data. The firm said the stock will rise to $25 or higher if that happens, and fall to $13-$14 and have an attractive valuation if the data is negative.

From a technical perspective, AUXL is challenging its 50-day moving average of $18.54 here with above average volume. This move is pushing the stock within range of triggering a near-term breakout trade. That trade will hit once AUXL takes out some near-term overhead resistance at $18.86 with high-volume.

Traders should now look for long-biased trades as long as AUXL is trending above its 50-day, and then when it takes out $18.86 with volume that’s near or above 393,527 shares. If we get that action soon, then AUXL should make a run at $20 to $21.25 in the near-term.

At the time of publication, author had no positions in stocks mentioned.

Roberto Pedone, based out of Windermere, Fla., is an independent trader who focuses on stocks, options, futures, commodities and currencies. He is also an outside contributor to Beconequity.com and maintains the website Maddmoney.net, which he sold to Blue Wave Advisors in 2008. Roberto studied International Business at The Milwaukee School of Engineering, and he spent a year overseas studying business in Lubeck, Germany.